We are in the process of transforming our energy system to make it climate-friendly and sustainable. This level of restructuring takes time. Energy from conventional sources is helping us ‘keep the lights on’.

Conventional energy sources still account for two thirds of the electricity that is generated in Germany. However, the ongoing expansion of renewables capacity and the phase-out of nuclear energy will have a lasting impact on the composition of the electricity mix. The electricity market is now being developed into an electricity market 2.0, which is capable of delivering energy security even in a system that is based on a high share of intermittent power from renewables.

Since 3 July 2017, the new SMARD Information Platform (in German language) has been providing information on the electricity market – almost in real time. This includes information on conventional energy sources. SMARD makes this data available in a form that is transparent, intelligible, and well-structured. This makes the platform a useful tool for different groups of users that are interested in following the energy transition and its progress. Experts can also make use of numerous tools for in-depth analysis.

Versatile natural gas: for heating, storage, power generation

With an annual consumption of approx. 95 billion cubic metres, Germany is one of the largest sales markets for natural gas in the European Union, and is also an important transit country for gas.

Gas will continue to make a major contribution to Germany’s energy supply in the coming decades. Only a small proportion of the natural gas used in Germany is produced in the country, while 94 per cent is imported from Norway, the Netherlands and other countries. Natural gas reaches Germany via pipelines, and is subsequently fed into the German long-distance gas grid and the downstream distribution grids.

An important role in the energy transition

Natural gas is one of the most important primary energy sources in Germany’s energy mix, second only to petroleum. In 2016, its share in Germany’s primary energy consumption amounted to 22.6 per cent.

Whilst the heat market is still by far the most important market for natural gas, this type of fuel is now being used for other purposes as well. In particular, gas can play an important role in the transition from fossil fuels to renewables in the power sector. Furthermore, natural gas also lends itself to being used in the transport sector. It has lower carbon emissions than other fossil fuels and is therefore more climate-friendly.

Infrastructure

The total length of Germany’s gas grid is 511,000 km. The pipelines which make up the gas grid are essential for transporting and distributing natural gas. They enable widely varying quantities of gas to be delivered safely over long distances. Considerable amounts of gas are transported across Germany to other EU states.

The Gas Network Development Plan, which is updated on an annual basis, stipulates which parts of the network are to be expanded that year to ensure a secure supply and safe and reliable operation of the network, in line with demand. You can find more information here.

Natural gas production in Germany: Fracking

In 2016, some 8 billion cubic metres of natural gas was produced in Germany, some of this using conventional fracking methods. Conventional fracking has been used in Germany for many years and is a proven method of extracting natural gas from sandstone rock formations. Safety always comes first, which is why fracking is banned in sensitive areas. The Federal Government has also clearly stated its opposition to the use of “unconventional fracking”; no experience has been gathered with this in Germany so far. Learn more.

Playing safely with the gas supply

For a country as dependent on gas imports as Germany, it is vital to have instruments in place that ensure security of the gas supply. Germany’s natural gas supply is highly secure and reliable. At close to 24.1 billion cubic metres, Germany has the world's fourth-largest gas-storage capacity, which is also the largest within the European Union.

In December 2015, the Federal Ministry for Economic Affairs and Energy published a list of key principles to underpin all measures to improve the security of the gas supply. Find out more about securing the gas supply and contingency planning.

Gas trade and regulation of the gas market

The German gas market is characterised by a large number of privately organised operators that specialise in networks, storage operations and gas trading. Germany is currently divided up into two market areas (NCG and Gaspool) that each have their own coordinator who is in charge of organising access to the gas network and of ensuring that market activities are conducted efficiently. There are 16 long-distance gas companies are currently operating on the German gas market. Other players include the distribution system operators, storage facility operators, and traders. The EU internal market package for the liberalisation of the market for electricity and natural gas, most recently amended by the Third Internal Energy Market Package, sets out the scope of activity for each type of market player. Under the Third Internal Energy Market Package, the operators of gas supply networks and storage facilities have been separated from those trading in natural gas. Germany’s power grids and gas networks are regulated by the Federal Network Agency and the regulatory authorities of the Länder.

Gas price and costs

Just like other goods and services, gas prices are determined by supply and demand rather than by way of regulation. There are different cost components.

Acquisition costs include the gas purchase price and transport costs. Distribution costs are all the costs involved in transmitting natural gas to the final customers. These costs also include all costs associated with the expansion and maintenance of the natural gas network.

Natural gas duty is levied on the consumption of natural gas depending on the amount and on the field of application. The exact provisions can be found in the Energy Tax Act.

Where network operators use public land for laying and operating gas pipelines, they are subject to a concession fee payable to the respective local authority. You can find out more about the gas prices here.

Power-to-gas: using gas to store energy

There is now an emerging trend towards using the natural gas grid in a different way that is highly promising. Electricity from renewables can be converted into hydrogen (and possibly methane) and fed into the natural gas grid, which could serve as a huge reservoir for several billion kilowatt hours of energy. A number of highly encouraging research and pilot projects are currently being conducted around this technology, to see how it could be used on a large scale, starting some time in the coming decade. For more information, please click here.

Gas-based mobility

One possible way of reducing carbon emissions from transport is to use natural gas as a fuel. This has the added benefit of also cutting emissions of particulates and nitrous oxides by a massive margin. For these reasons, the Economic Affairs Ministry has launched a Round Table on Gas-Based Mobility. The aim here is to enable the transport sector to increase the share of gas-powered vehicles to at least four per cent of Germany’s final energy consumption by 2020. Find out more.

Coal

Energy for electricity generation and industry

Hard coal and lignite still play an important role in the energy mix, accounting for almost 25 per cent of Germany’s primary energy consumption.

2Coal and lignite are among the most important energy sources for power generation. Some 40 per cent of our electricity is generated from coal and lignite (lignite: 23.1 per cent, hard coal: 17.2 per cent).

Hard coal: an important commodity for power generation and the steel industry

The bulk of the hard coal consumed in Germany is used to generate electrical power and to produce steel. In 2016, power stations accounted for 78 % of Germany’s total consumption of hard coal, with the remainder being used by the steel industry (20 %), and for home fires and small-scale consumers (roughly 2 %). Over several decades now, hard-coal mining in Germany has been undergoing a process of restructuring, with both its output and the number of mines and employees experiencing a constant decline. As a result of this, imports now account for approx. 90 % of the German market for hard coal and hard coal products (54.1 million tonnes in 2016). For further information on hard coal production and subsidies, please click here.

Lignite: A domestic fossil fuel

There are four areas in Germany that still have active lignite mines, all of them open-cast mines. These are Rhine, Lausitz, Central Germany and Helmstedt. In 2016, their combined annual extraction rate was 171.5 million tonnes. Germany is the world’s leading extractor of lignite, ahead of China, Russia and the United States. For more information on hard coal and lignite, please clickhere.

Mining statistics: Facts and figures on mining in Germany

Germany has a long mining tradition, and mining continues to be an important sector to this day. There are more than 20,000 people employed in mining operations, extracting coal and lignite, gas, oil, potash and salts. Every year, the Federal Ministry for Economic Affairs and Energy and the mining authorities of the Länder produce a joint annual report entitled "Mining in the Federal Republic of Germany – The mining sector and statistics". The report (known as the “Blue Booklet” because it used to come with a blue cover) is a compilation of comprehensive data from all the mining companies in Germany and provides detailed statistics on the sector.

Petroleum and Motor Fuels

A raw material for transport

Oil continues to be one of the main forms of energy used in Germany. Oil and motor fuels account for 34 per cent of our primary energy consumption, and the bulk of this is imported.

With a share of approx. 34% of primary energy consumption in 2016, oil remains the most important primary energy source in Germany. Back in the 1970s, oil accounted for more than half of Germany’s primary energy consumption, but its share dropped in the 1980s, largely due to the increased use of gas for heating. Oil plays an important role in the transport sector, accounting for 94% of the final energy consumption in the transport sector in 2015.

In 2016, domestic sales of oil products amounted to approx. 104 million tonnes. In quantitative terms, the main oil products were diesel fuel (38.4 million tonnes), gasoline (18.3 million tonnes), naphtha (16.5 million tonnes), which is used for petrochemicals, and light fuel oil (15.8 million tonnes), and light fuel oil (15.8 million tonnes). Other oil products include kerosene (9.2 million tonnes) and heavy fuel oil (4.5 million tonnes); the latter is used in industry.

For some years, biofuels like bioethanol and biodiesel have been helping to cover the energy supply and to mitigate climate change. Find out more about alternative fuelshere.

Trade in oil and oil imports

In 2016, Germany’s crude oil imports amounted to approx. 91 million tonnes. This is eighteen million tonnes less than a decade before. Russia is Germany’s number-one supplier, accounting for just under 40 per cent of the country’s crude-oil imports last year. In 2016, some 22.4 million tonnes of gas was imported from Norway and EU Member States – a figure that corresponds to less then a quarter of Germany’s crude oil imports.

Extraction, transport, and refining of crude oil

There are four cross-border oil pipelines running into Germany, and oil is also being imported via the ports of Wilhelmshaven, Brunsbüttel, Hamburg and Rostock. The ports of Wilhelmshaven, Brunsbüttel and Rostock are connected to pipelines through which the oil can be taken to various refineries. This pipeline infrastructure is owned by the oil-processing industry. In most cases, it is operated by firms that are jointly owned by several oil companies. Crude oil and intermediate and finished oil products are stored in underground caverns, refineries, and numerous tanks located outside the refineries. Germany’s combined storage capacity for oil and oil products amounts to approx. 62 million cubic metres, of which 40% takes the form of caverns.

The markets for motor fuel and other fuels

Diesel, gasoline, and other motor fuels such as LPG and natural gas are sold at the more than 14,000 roadside fuelling stations and some 360 fuelling stations located along the motorways (autobahnen). In addition to the major oil companies, there are also numerous independent companies active on the motor fuel market. You can find out more about this topichere.

Just like other goods and services, gas prices are determined by supply and demand rather than by way of regulation. The price of crude oil has a major impact on the amount of fuel that is available, and thus on the price consumers pay at the petrol pump. You can find out more about fuel priceshere.

Our goal: a secure supply of oil

Numerous sectors depend on a reliable supply of oil, including private and commercial transport, shipping, aviation, heating, and manufacturing. As we have seen in the past, better energy efficiency and energy conservation, and switching over to technologies using other sources of energy can help reduce our dependency on oil. Given our high level of dependency on oil imports and the risks affecting the world market, however, there is a need to take precautions against short-term disruptions to supply. Within the Federal Government, the Federal Ministry for Economic Affairs and Energy is in charge of ensuring energy security and preparing the country for any potential energy crises. You can find out more about contingency planning here.

Phasing out nuclear power without compromising on security

As part of its energy transition, Germany has decided to phase out nuclear power. At present, there are 7 nuclear power plants still operating in Germany. These will be successively shut down, with the last ones closing by the end of 2022.

Ever since the catastrophic accident at the Japanese Fukushima nuclear power plant, there has been strong consensus in Germany in favour of a nuclear phase-out. This process is to be completed by 2022.

Nuclear power plants in Germany

A total of 37 nuclear power plants have been built in Germany and put into commercial operation since 1962. At present, there are 7 nuclear power plants still operating, generating approximately 10,000 MW. These plants are now being taken off the grid in a pre-defined order: the Gundremmingen B nuclear power plant by the end of 2017, followed by Philippsburg 2 by the end of 2019, and Grohnde, Gundremmingen C and Brokdorf by the end of 2021. The three newest plants, Isar 2, Emsland and Neckarwestheim 2, will be disconnected from the grid no later than the end of 2022.

Long-term financing for nuclear phase-out secured

Under the Atomic Energy Act and in line with the polluter-pays principle, it is the operators of nuclear power plants (NPPs) that must pay for the shut-down and dismantling of the NPPs, and for the management of the nuclear waste produced by them, including the cost of final storage.

The Act assigns the respective responsibilities around nuclear disposal and provides for secure, long-term financing for the decommissioning and dismantling of nuclear power plants and the disposal of nuclear waste, without either shifting the costs on to taxpayers or jeopardising operators’ business.

In other words, this piece of legislation ensures that the operators of nuclear power plants will continue to be in charge of managing and financing all activities linked to the decommissioning and dismantling of the installations, and to the correct packaging of nuclear waste. In contrast, it is the Federal Government that will be responsible for organising and financing interim and final storage. On 1 July 2017, the funds to cover the costs for interim and final storage, which will amount to up to 24 billion euros, were transferred by the operators into the fund administered by the Federal Government.

Previously, on 26 June 2017, Federal Minister Brigitte Zypries and the executive directors of the energy companies signed an agreement under public law in recognition of the new division of responsibilities as assigned under the new legislation. This agreement has delivered legal certainty for both the Federal Government and the energy companies. It also puts an end to the many legal disputes that have been fought around the subject of nuclear-waste disposal and the phase-out of nuclear energy. You can find the text of the agreement here (in German language) (PDF, 4MB).

The board – which is charged with establishing and supervising the foundation – convened for the first time on 19 June 2017 and took various important decisions of an organisational nature. Click here (PDF: 37 KB) for more detailed information on the division of responsibilities around the nuclear phase-out.

The Act is to implement the recommendations made by the Commission to Review the Financing for the phase-out of nuclear energy. This means that, for the first time, the responsibilities for organising and financing the disposal of nuclear waste will be brought together. The Commission has been set up by the Federal Government on 14 October 2015. The experts on the Commission were tasked with drawing up recommendations on how to organise the financing for the shut-down and dismantling of nuclear power plants and for the management of nuclear waste in such a way that companies would be capable of meeting their long-term obligations under nuclear law. On 27 April 2016, the Commission completed this task by presenting its unanimous recommendations for action in a report to the Nuclear Energy State Secretaries Committee. You can find the Commission's recommendations in the final report (in German language) (PDF, 969KB).

Expert report assessing the financial provisions that have been made by the nuclear-power industry (“stress test”)

Much of the Commission’s work was based on the expert report assessing the provisions made by the nuclear-power sector ("stress test"), which was commissioned by the Federal Ministry for Economic Affairs and Energy on 10 October 2015. The authors of the report found that the energy companies are capable of bearing the cost of dismantling the nuclear power plants and of disposing of the nuclear waste. The provisions made by the companies for these purposes total €38.3 billion, an amount that was calculated on the basis of estimates that put the total cost of the disposal at around €47.5 billion in current prices. The experts have confirmed that the estimated costs are plausible and complete, and that the provisions had been correctly incorporated into companies’ balance sheets.

The German government also commissioned a comprehensive study into the legal aspects of the provisions made in the nuclear-power sector and any related need for reform.

Final disposal of radioactive waste

The search for a suitable final repository for highly radioactive waste, that will need storing for a period of a million years, continues. The Repository Site Selection Act entered into force in July 2013 and provides for an open-ended, transparent and scientific site selection process. The Federal Ministry for Economic Affairs and Energy is responsible for basic research into nuclear disposal; this research is not tied to any specific site and is designed to be applied in practice. The focus is on how to handle and dispose of nuclear waste in a way that is safe and secure. A more detailed description of this research and development work can be found in the document “Research on the Disposal of Radioactive Waste (2015-2018)”, which outlines the funding for this work. Find out more about the final disposal of radioactive waste and research into final disposal in Germany.

Research to improve reactor safety

The research on the safety of nuclear energy undertaken by the Federal Ministry for Economic Affairs and Energy contributes towards what is recognised internationally as a high safety standard in German nuclear power plants. It defines the state-of-the-art when safety assessments are made. Research projects for which funding has been made available include some that have served to develop calculation tools for process assessment and analysis in nuclear power plants, and for investigating changes in the properties of materials in conditions that match those in nuclear power plants. Beyond this, the work also helps safeguard expertise around nuclear technology and radiation protection that will still be needed for medical, industrial, and research purposes once the nuclear phase-out has been completed.

In view of the international trend towards continued use of nuclear energy, the German government wishes to retain the skills needed to assess the safety of nuclear power plants in neighbouring countries and, if necessary, to make proposals for improvements. For this reason, research on the safety of nuclear energy is increasingly taking place in the context of international cooperation, e.g. in the EU (Euratom) and the OECD Nuclear Energy Agency.

27/04/2016 - Press release - Conventional Energy Sources

Press release:Commission to Review the Financing for the Phase-out of Nuclear Energy presents recommendations to the Federal Government